We need a tax signal more than a fiscal one

According to Ajit Ranade, Chief Economist of the Aditya Birla Group, what the budget's priorities should be, he would prefer to avoid being seen as a fiscal hawk - where the first priority of the finance minister would be to balance his books.

He said the Finance Minister, Pranab Mukherjee, faces many constraints - including the huge interest burden on rising borrowings.

Reuters

However, he told Firstpost's R Jagannathan that the main task ahead of Pranab Mukherjee is to revive investment.

While fiscal consolidation is obviously important, he believes the investment cycle is more likely to be set off by a tax signal rather than a fiscal one.